Mighty Corporation vs E & J Gallo Winery

E & J is a foreign corporation engaged in the production and selling of wines and
brandy products since 1991.
Mighty Corp. is engaged in tobacco products and using the GALLO cigarette
trademark since 1973.
DISPUTE: when Gallo Winery sued Mighty Corp for TM infringement alleging
that the latter ride on Gallo's TM for its popularity and reputation causing
confusion on the purchasing public.
The respondent contended that Gallo's winery TM covered wines only and not
cigarettes.

Issue:

WON Gallo cigarettes infringe the TM of Gallo winery?

Held:

No.

The SC ruled in favor of the petitioner Mighty Corporation. No infringement.

Applying section 20 of the TM Law, Gallo Winery's exclusive right to use the Gallo TM
should be limited to wines, the only product indicated in its registration certificate.

The crucial issue in any trademark infringement case is the likelihood of confusion,
mistake or deceit as to the identity, source or origin of the goods or identity of the
business as a consequence of using a certain mark.
There are two types of confusion:

"confusion of goods"
Prudent purchaser is induced to purchase one product in the belief that he is
purchasing another

"confusion of business"
The goods of the parties are different but the defendant's product can reasonably
be assumed to originate from the plaintiff, thus deceiving the public into believing
that there is some connection between the P and D.

In this case the confusion of business does not exist because actual commercial use of
in the Philippines of Gallo Cigarette TM preceded that of the Gallo wine TM.